Stock Market Investment Trends – Dow Jones Returns in the First Half of 2010 for All 30 Components

   
Stock Market Investment Trends – Dow Jones Returns in the First Half of 2010 for All 30 Components

The stock market for beginners can be an intimidating place. The New York Stock Exchange alone boasts 2,800 listings worth over $12.2 trillion dollars. Even a simple investing strategy like “find a healthy growth stock with improving earnings” can seem overwhelming when you’re faced with the sheer number of companies out there to invest your retirement money in.

Does that mean stock investing for beginners has to end in heartbreak and the loss of some hard-earned retirement money? Heck no! But getting a general feel for the investment landscape is key in the stock market for beginners. Watching daily stock exchange returns and sifting through individual company reports in pursuit of the latest flash-in-the-pan stock to buy may not be in your best interest.

Even seasoned investors can learn a thing or two from a broad stock market analysis before they roll up their sleeves and get down to buying stocks. Think of it like checking the weather report before you leave on a weekend trip – no matter what direction you’re driving in, the conditions are going to play a large role in how successful your journey is and how long it takes for you to get there!

Dow Jones Returns – Component Stocks from Jan. 1 to June 30, 2010

There’s no easier way to get an overview of the investment environment than to look at the big indexes like the Dow Jones Industrial Average and the S&P 500 Index, right? But while that is true – but only if you look beyond the numbers. Just because the Dow Jones goes down doesn’t mean it’s a bear market for all investments, and just because the Dow goes up doesn’t mean that every stock will make you money.

The trick is to view the Dow not as a stock market but a market of stocks. That may sound like semantics, but the difference is that instead of watching the headline Dow number you are paying attention to the individual stocks that make up that reading – and plotting trends accordingly.

Consider that for the first half of 2010 — stock market trading from January 1 to June 30 – the Dow Jones returns tallied a loss of a little more than -5%. But not all of the Dow components stumbled. The best performing stock in the DJIA was aerospace giant Boeing (BA), tallying a +18% gain for the first six months of 2010. Four other stocks posted gains in the first half of the year – Caterpillar (CAT) was up almost +7%, as was McDonald’s (MCD). Dupont (DD) was up almost +5% and Kraft (KFT) added +3%.

Now lets look at the five biggest losers: Far and away the worst stock among Dow Jones returns in 2010 was Alcoa (AA), which shed about -36%. Next was Microsoft (MSFT), which lost -22% and then Pfizer(PFE) which lost -20%.  Exxon Mobil (XOM) and Hewlett-Packard (HPQ) round out the group, with both tallying losses of about -15% in the first six months of the year.

So what does these big 5 winners and big 5 losers tell us about the market? That’s up for interpretation. It’s worth noting that of the top performers, all of these stocks yield a high dividend of at least 2.6% — while only two of the biggest losers sport dividends of bigger than 3%. It’s also worth noting that the losers feature two tech stocks while the winners feature cheap consumer stocks like low-priced restaurant McDonald’s and foods giant Kraft. You can draw your own conclusions from the data, but the important thing is to try and find a trend beneath that big picture.

One important trend could be that only 5 of the 30 components turned a profit in the first six months – and that 11 component stocks shed -10% or more in the first half of the year. That’s not a very hospitable environment for stocks.

Here’s a complete listing of each Dow Jones component stock, key statistics like dividend yield and market cap, and its total returns for the first six months of the year. You can draw your own conclusions based on the data:

3M (MMM)

Industry: Industrial conglomerate

Market Cap: $56.0 billion

Dividend yield: 2.7%

YTD Returns: -5.0%

 

Diversified manufacturer 3M (3M) is best known for Scotch Tape and Post-It Notes, but the company has its fingers in a wide array of other industries from transportation to healthcare to communications. 3M boasts over 76,000 employees, with operations in over 60 countries that help produce over 55,000 products. 3M has performed a hair better than the broader market so far this year, tallying a decline of -5.0% for the first six months of 2010 while the Dow Jones Industrial average has shed -5.3% and the S&P has lost about -6.6%.

Alcoa (AA)

Industry: Metals

Market Cap: $10.6 billion

Dividend Yield: 1.2%

YTD Returns: -35.9%

The Pittsburgh based company Alcoa (AA) operates in 44 countries and is the third largest producer of aluminum world wide.  Alcoa also owns businesses in the fields of fastening systems, building products and electrical distribution systems for cars.  This aluminum producer has seen severe declines in 2010, dropping -$5.78 or -35.9% over the past six months.

American Express (AXP)

Industry: Financials

Market Cap: $48.6 billion

Dividend Yield: 1.8%

YTD Returns: -1.6%

Financial service company American Express (AXP) is known for its credit card and traveler’s check businesses.  American Express accounts for nearly 24% of the total dollar volume of credit card transactions in the U.S.  Amex has declined marginally in 2010, down -1.6% since January, which compares favorably to the Dow Jones Industrial average and the S&P which are down -5.3% and -6.6% respectively.

AT&T (T)

Industry: Telecommunications

Market Cap: $143.7 billion

Dividend Yield: 6.9%

YTD Returns: -13.2%

Telecommunication company AT&T (T) is the second largest provider of mobile telephone service in the U.S., and is also known for its broadband and subscription television service.  The phone service provider boasts 150 million total customers, including 85.1 million wireless customers in the United States – thanks in part to its exclusive agreement with the Apple iPhone (for now anyway).  AT&T has fared about 2x worse than the broader market this year, down -13.2% in 2010.

Bank of America (BAC)

Industry: Financials

Market Cap: $147.5 billion

Dividend yield: 0.27%

YTD Returns: -2.7%

Bank of America (BAC) is the largest bank holding company and the second largest bank by market capitalization in the U.S.  The financial services company has a relationship with 99% of U.S. Fortune 500 companies, and works with clients in over 150 countries.  Bank of America has done slightly better than the broader markets, as it has shed only -2.7% over the past six months.

Boeing (BA)

Industry: Aerospace and defense

Market Cap: $48.6 billion

Dividend yield: 2.6%

YTD Returns: +18.2%

Aerospace and defense company Boeing (BA) is the largest global aircraft manufacturer by revenue orders and deliveries, and is the third largest aerospace and defense contractor in the world.  Additionally, the Chicago based company is the largest U.S. exporter by value.  Boeing stock has made big strides throughout 2010 and is currently up +18.2% since January – a significant gain, especially in the face of broader market woes. 

Caterpillar (CAT)

Industry: Construction equipment

Market Cap: $38.3 billion

Dividend yield: 2.9%

YTD Returns: +6.9%

Caterpillar Inc. (CAT) specializes in the design, production and selling of construction and mine equipment, and is ranked No. 1 in its industry with more than $67 billion in assets.  Caterpillar is also known for its production of diesel and natural gas engines and industrial gas turbines.  The manufacturer currently ranks No. 44 in the 2009 Fortune 500.  Caterpillar stock has risen +6.9% over the past six months, as compared to the Dow Jones Industrial average which is down -5.5% and the S&P which is down 6.6%.

Chevron Corp. (CVX)

Industry: Oil and gas

Market Cap: $137.8 billion

Dividend yield: 4.2%

YTD Returns: -11.0%

Energy company Chevron (CVX) is involved with the exploration, production  and sales of oil, gas and geothermal resources.  Chevron is considered one of the world’s six major oil companies and is currently active in more than 180 countries.  Other Chevron products include petroleum, natural gas, lubricant, fuel and petrochemical.  The oil company previously saw gains in 2010, but is currently down nearly -11%, almost twice what the broader market has lost.

Cisco Systems (CSCO)

Industry: Computers and Technology

Market Cap: $123.7 billion

Dividend yield: N/A

YTD Returns: -9.6%

Multinational computer networking company Cisco Systems (CSCO) specializes in the design and sale of consumer electronics, networking and communication technology and services.  Headquartered in San Jose, Calif., Cisco Systems has an annual revenue of over $36 billion and employs over 65,000 workers.  Much like Chevron, Cisco Systems stock was up at the end of April, but has since fallen, and is currently down -9.6% for 2010.

Coca-Cola (KO)

Industry: Consumer staples

Market Cap: $116.3 billion

Dividend yield: 3.5%

YTD Returns: -11.5%

Best known for its signature soft drink Coke, the Coca-Cola Company (KO) offers over 400 brands in more than 200 countries. Based in Atlanta, the beverage company operates under a franchise distribution system, in which the Coca-Cola Company produces the syrup for its beverages, which is then sold to numerous bottlers across the globe.  Coca-Cola’s stock has gradually declined throughout 2010 and is currently down -11.5%.  Comparatively, the broader markets have fared better as the Dow Jones Industrial average is down -5.1% in 2010, while the S&P is down -6.2%.

DuPont (DD)

Industry: Chemicals

Market Cap: $32 billion

Dividend yield: 4.7%

YTD Returns: +4.8%

Chemical company DuPont (DD) is currently the world’s second largest chemical company in terms of market capitalization, and fourth largest in terms of revenue.  DuPont, which is based in Wilmington, Del., is known for such iconic products as Kevlar, Neoprene, Nylon and Teflon.  DuPont has performed better than the broader markets in 2010, and is currently up +4.8% on the year.

ExxonMobil (XOM)

Industry: Oil and gas

Market Cap: $270.4 billion

Dividend yield: 3.1%

YTD Returns: -15.6%

ExxonMobil (XOM) is the largest of the world’s six “supermajor” oil companies and the largest company on Wall Street by market cap, owning 38 oil refineries in 21 countries.  The oil super giant has a daily refining capacity of over 6.3 million barrels, and produces about 3.9 million barrels of oil every day on average.  At the end of 2007, Exxon reported over 72 billion reserve oil-equivalent barrels.  Despite the staggering production numbers, Exxon stock has declined steadily over the past several months, and is down -15.6% for 2010. 

General Electric (GE)

Industry: Industrial Conglomerate

Market Cap: $155.6 billion

Dividend yield: 2.8%

YTD Returns: -3.7%

Multinational conglomerate General Electric (GE) is considered by Forbes to be the second largest company in the world based on sales, profits, assets and market value.  General Electric, which boasts 304,000 employees, has ties in numerous industries, including oil, gas, energy, electric distribution, entertainment and healthcare, just to name a few.  Over the past six months, General Electric’s stock is down slightly, at -3.7 %.  However, GE has still outperformed the broader markets, as the Dow Jones Industrial average is down -5.1% and the S&P is down -6.2%.

Hewlett-Packard (HPQ)

Industry: Computers and Technology

Market Cap: $102.5 billion

Dividend yield: 0.73%

YTD Returns: -14.8%

Multinational information technology company Hewlett-Packard (HPQ) is known for its various consumer products including personal computers, televisions, printers, scanners, mobile phones and servers. HP became the first information technology company to post revenue over $100 billion when it reported $104 billion in 2007.  In 2009, Hewlett-Packard reported $115 billion in revenue.  Despite the continual growth in revenue, however, HP’s stock has fallen in 2010 and has reported a drop of -14.8% since January.

The Home Depot (HD)

Industry: Home improvement retail

Market Cap: $48.3 billion

Dividend yield: 3.3%

YTD Returns: -0.6%

Home improvement retailer Home Depot (HD) owns nearly 2,200 stores in the United States, and is one of the largest retailers in the world by sales.  Home Depot offers customers a wide array of products, including lumber, appliances, paint, flooring, plumbing and building materials, to name a few.  Despite drops by broader markets during 2010, Home Depot’s stock has remained relatively flat and is down just -0.6% since January.

 

IBM (IBM)

Industry: Computers and Technology

Market Cap: $160.4 billion

Dividend Yield: 2.1%

YTD Returns: -4.4%

Information technology giant International Business Machines Corporation (IBM) is known worldwide for its computer, technology, and IT consulting services. As the second largest information technology and services employer in the world, IBM employs almost 400,000 employees worldwide with operations in 200 countries. IBM is performing slightly better than the market for the first six months of 2010, with a -4.4% decline versus the -5.3% loss for the Dow Jones Industrial average and a -6.6% drop for the S&P.

Johnson & Johnson (JNJ)

Industry: Pharmaceuticals

Market Cap: $163.3 billion

Dividend Yield: 3.6%

YTD Returns: -8.1%

Pharmaceuticals manufacturer Johnson & Johnson (JNJ) is commonly identified with its popular Band-Aid Brand bandages, Tylenol medications and baby products, making it a household name in both medical and consumer packaged goods manufacturing. The renowned corporation and its some 250 subsidiary companies sell goods in over 150 countries. Johnson & Johnson’s stock has fallen behind the broader market for the first six months in 2010, reporting a -8.1% drop off while the Dow Jones Industrial average came in at -5.3% and the S&P at -6.3%.

 

JPMorgan Chase (JPM)

Industry: Financials

Market Cap: $148.4 billion

Dividend Yield: 0.5%

YTD Returns: -10.5%

Financial services firm JPMorgan Chase & Co. (JPM) is among other things, best known for its investment banking, commercial banking, and asset management. Serving millions of consumers and some of the world’s most prominent corporate clients, JPMorgan Chase operates in 60 countries and boasts the largest hedge fund and market capitalization in the world. For the first six months of 2010 JPMorgan Chase performed well behind the broader market, clocking in with a loss of -10.5%.

Kraft Foods (KFT)

Industry: Consumer Staples

Market Cap: $49 billion

Dividend Yield: 4.1%

YTD Return: +3.2%

Kraft Foods (KFT) is a confectionary, food, and beverage corporation known for its numerous popular brands such ad Maxwell House and Oscar Mayer. Kraft Foods is headquartered in the United States and its brands are marketed in more than 155 countries. KFT saw a favorable first half of 2010 with a +3.2% gain.

McDonald’s (MCD)

Industry: Hotels & Restaurants

Market Cap: $71.5 billion

Dividend Yield: 3.3%

YTD Return: +6.5%

 

McDonald’s (MCD) is the fast food powerhouse that serves nearly 47 million around the world each day. With more than 31,000 locations and 400,000 employees, McDonald’s has aggressively grown a global brand over the past several decades. For the first six months of 2010 MCD managed to stay well above the market averages, reporting a +6.5% gain and keeping it in the green while the broader market has stumbled.

Merck (MRK)

Industry: Pharmaceuticals

Market Cap: $109.2 billion

Dividend Yield: 4.3%

YTD Returns: -4.2%

Merck & Co. (MRK) is the global healthcare company that manufactures and markets drugs like Vioxx, Propecia, and Zocor. For the first six months of 2010 MRK has reported declining numbers but still comes in just above the market averages at -4.2%. The Dow Jones Industrial average finished at -5.2%, and the S&P at -6.3% for the first half of 2010.

Microsoft (MSFT)

Industry: Computers and Technology

Market Cap: $207.2 billion

Dividend Yield: 2.2%

YTD Returns: -22.4%

Microsoft Corporation (MSFT) is a giant in the software industry and is known globally for its Windows operating system and Microsoft Office suite. Microsoft employs almost 93,000 people in more than 100 countries. Microsoft has had a disappointing six months in 2010, reporting a loss of -22.4%.

Pfizer (PFE)

Industry: Pharmaceuticals

Market Cap: $116.6 billion

Dividend Yield: 4.9%

YTD Returns: -20.6%

Pharmaceutical manufacturer Pfizer Incorporated (PFE) is known for its drugs such as Lipitor, Viagra, and Zanax, making it number 1 in the world of pharmaceutical sales. Pfizer has more than 116,000 employees and numerous research facilities around the United States. Pfizer has faced a steady decline during the first six months in 2010, ending June with a drop to -20.6%, significantly lower than both the Dow Jones and S&P averages for the same period.

Proctor & Gamble (PG)

Industry: Consumer Goods

Market Cap: $173.7 billion

Dividend Yield: 3.2%

YTD Returns: -0.5%

Proctor & Gamble Co. (PG) is responsible for consumer goods which include brands like Crest, Gillette, Pringles, and Pampers, among many others. With its products sold in more than 180 countries worldwide, Proctor & Gamble is able to employ 140,000 people in its ranks. Proctor & Gamble closed out the first six months of 2010 ahead of market averages, but still slightly in the red at -0.5%. The Dow Jones Industrial average fell to -5.1% and the S&P 500 to -6.1% so far this year.

Travelers (TRV)

Industry: Insurance

Market Cap: $24.6 billion

Dividend Yield: 2.9%

YTD Returns: -0.3%

The Travelers Companies (TRV) is the largest insurance company by market value in America, specializing in property and casualty insurance products. In addition to its more than 14,000 independent agents, brokers, and representatives in every state in the U.S., Travelers operates in countries all over the globe. The first six months of 2010 has been a story of ups and downs for Travelers, but it managed to end June above market averages at -0.3%.

United Technologies Corporation (UTX)

Industry: Aerospace & Defense

Market Cap: $61.1 billion

Dividend Yield: 2.6%

YTD Returns: -5.7%

Buildings systems and aerospace manufacturers United Technologies Corporation (UTX) is known for its high-technology products such as aircraft engines, heating and cooling products, fuels cells, and military missiles and helicopters. The Hartford, Conn.-based company employs more than 206,000 people and is a large military contractor. UTX performed on par with the market averages for the first six months of 2010 finishing at -5.7% down, in between the Dow Jones Industrial average (-5.3%) and the S&P (-6.4%).

Verizon Communications (VZ)

Industry: Telecommunications

Market Cap: $80.2 billion

Dividend Yield: 6.7%

YTD Returns: -14.4%

Verizon Communications (VZ) is best known for its Wireline and Domestic Wireless communications services which include internet, broadband and network services. Verizon has an international customer base of about 91 million people and it employs more than 222,000 people worldwide. So far this year, Verizon has dropped -14.4% compared to the -5.3% loss in the Dow Jones Industrial average and the -6.3% loss for the S&P.

Wal-mart (WMT)

Industry: Retail

Market Cap: $179.4 billion

Dividend Yield: 2.5%

YTD Returns: -9.5%

Wal-mart (WMT) department stores are known as a discount retail chain now representing the largest public corporation by revenue in the world. With more than 2.1 million employees, Wal-Mart has spread across all 50 U.S states and numerous foreign countries. The performance of Wal-Mart during the first six months of 2010 was worse than the broader market, with shares down -9.5%.

Walt Disney (DIS)

Industry: Broadcasting & Entertainment

Market Cap: $62.7 billion

Dividend Yield: 1.1%

YTD Returns: -0.8%

The Walt Disney Company (DIS) is a leader in the film, broadcast, and entertainment industries, with brand names such as ABC and ESPN in television and its film and resort companies as worldwide favorites. The largest media and entertainment conglomerate in the world, Walt Disney employs more than 150,000 people. Walt Disney fell to -0.8 for the first six months in 2010. Disney fared better than the market averages for the same period, with the Dow Jones Industrial average at -5.3% and the S&P at -6.4%


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